As Trade Deficit Soars, Industry Seeks Controls On Imports

April 1, 2005

As the US Commerce Department reported that the trade deficit reached a record $61 billion in
February, industry lobbyists called for the government to take measures to correct the currency
imbalance that gives China and other nations an advantage in pricing their exports to the United
States. In the first two months of this year, the trade deficit with China rose by 47 percent over
the comparable period last year, and industry officials said at that rate it could grow to $238
billion this year. The US trade deficit in textiles and clothing was $12.9 billion in the first two
months of this year, an increase of 16.5 percent. If trade continues at its present rate, the
textile and apparel deficit could reach $85 billion this year.

Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition, said
the deficit should send a strong signal to Congress and the White House that the current trade
policies are not working, and he called for passage of legislation pending in Congress that would
declare currency manipulation illegal and levy tariffs on goods from countries that subsidize their
currencies to help offset pricing advantages resulting from currency imbalances.